"Our calculation implies that from an average revenue per user (ARPU) growth, market is now implying a de-growth. However, we still maintain that 15-20 per cent ARPU CAGR is likely and essential for survival of industry," the brokerage firm said in stock update.
Contrary to stock reaction, business trajectory of Bharti Airtel
remains healthy and positive especially in 4G smartphone subscriber additions viz. at par / ahead of Jio. MNP (mobile number portability) request from postpaid subscribers for transition to Jio postpaid is limited. "We appreciate Bharti's in-market execution and the clarity on thoughts and strategy to drive the market share and growth. A few months' delay in tariff increase doesn't alter the strong long-term industry potentials and consecutive positive bias of ours," it said in its report and reiterated 'BUY' on Bharti with target price of Rs 605 per share.
"Bharti Airtel's stock price has corrected due to investor concerns on mobile tariff hike delay. We continue to maintain that the current pricing is not sustainable and therefore expect price hike in the medium to long term. We expect Bharti Airtel
to benefit in the medium to long term, given its strong execution and premium position in the sector. We maintain our positive stance on Bharti Airtel with an OUTPERFORM rating and a target price of Rs700," said a recent report by Credit Suisse.
Meanwhile, the board of directors of Bharti Airtel will meet on October 27, 2020 to consider the audited financial results for the second quarter ended September 30, 2020 (Q2FY21).
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